Approximately 300 biotechnology, pharmaceutical, equipment, biofuels and medical device companies are based in Virginia, mainly clustered around universities in Blacksburg, Charlottesville, Richmond, Norfolk and Northern Virginia. This blog is an informal diary of what is going on with the industry in Virginia. Opinions here are those of the posters and not necessarily shared by Virginia Bio.

Saturday, January 20, 2007

Former FDA Commissioner Lester Crawford would face a $50,000 fine and probation but no jail time as punishment for lying about ownership of illegally held stocks, according to a deal worked out between his attorney and federal prosecutors.

Crawford and the government both have agreed to the fine and some form of probation, though his ultimate sentence will be at the discretion of Magistrate Judge Deborah A. Robinson, according to sentencing memoranda filed with the U.S. District Court in Washington.

His sentencing is set for Tuesday.

Crawford pleaded guilty in October to charges of having a conflict of interest and false reporting of information about stocks he and his wife owned in food, beverage and medical device companies he regulated while head of the Food and Drug Administration.

The U.S. Attorney's office recommended the $50,000 fine, saying it would exceed the roughly $39,000 Crawford and his wife, Cathy, made from exercising options and in dividends from the forbidden stocks they held in the FDA-regulated companies.

The government also recommended Crawford be sentenced to probation and community service but skip any jail time, according to its sentencing memo filed with the court. Crawford could face up to six months in jail under sentencing guidelines.

"Given his early acceptance of responsibility, the defendant's actions merit the stigma of criminal convictions, a fine, and probation, but not incarceration," according to the government memo, signed by assistant U.S. attorneys Howard R. Sklamberg and Timothy G. Lynch. Sklamberg declined to comment Friday.

Crawford's attorney, Barbara Van Gelder, said her client agreed to pay the fine, according to her memo to the court. However, Van Gelder specifically requested unsupervised probation, which would allow Crawford to travel overseas for work. Van Gelder did not mention community service in her memo. She did not immediately return a message seeking comment.

In October, Crawford admitted to falsely reporting that he had sold or did not own stock when he continued holding shares in the firms governed by rules of the FDA, which is illegal. Beginning in 2002, Crawford filed seven incorrect financial reports with a government ethics office and Congress, leading to the misdemeanor charges.

Although Crawford lied about ownership of the stocks -- including under oath before the Senate -- government attorneys acknowledged there is no evidence he was "engaged in a concerted scheme to use his high office for personal gain."

Van Gelder, meanwhile, suggested Crawford's wife, secretary and financial adviser prepared and handled the inaccurate financial statements Crawford filed with the government. She acknowledged, however, that Crawford remained ultimately responsible for their accuracy.

Crawford, a veterinarian and food-safety expert, abruptly resigned from the FDA in September 2005 but gave no reason for leaving. He had held the job for two months, following his confirmation by the Senate.